14. The role of seafreight import forwarding service of the company
3.2. Objectives set out for future development by Integrate Logistics
After 10 years since its establishment, the business conditions of the company have gone into stable development. In addition to maintaining and promoting its strength from the export business, the company is looking forward to developing the network of import business in accordance with market development and _ profit potentials.
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With a long-term strategy (2013 — 2020) to develop the company into a 3PL logistics service provider such as warehouse rental, distribution network design and other services to customers (value-added services), the company will no longer focus exclusively on price competition with thousands of small and medium sized domestic logistics companies, but has shifted to refining its logistics services to compete for service quality. Integrate Logistics will compete for value added services and deeper engagement in the customer's import — export supply chain, rather than merely providing freight forwarding services.
To find the optimal solution to streamline and perfect the procedure of importing and delivering goods, application of advanced technology to optimize import handling time and improve the productivity of employees shall be considered. In the long run, the company will upgrade the quality of customer service and increase interaction with customers during the delivery process. Other objectives include specializing the work of functional departments; managing and evaluating more closely the outsourced carriers; developing more services related to importing goods following the success of other domestic enterprises and new trends of the world.
3.2.2. Objectives set out for development in 2018
The goals set out by the company to implement in the next year running shall be as follows. First, Integrate Logistics will focus on analyzing, finding the management software appropriate to the condition of the company and cost-effective. To see about this goal, the company has executed several researches for suppliers and quotations.
Second, the improvement of customer satisfaction to reach the level of 90% is of essential importance. The satisfaction level currently is 80%, measured by feedback forms carried out by the company after every transaction.
Third, restructuring the manners of the outsourced carriers. In 2018, all the precedures involving third-party shall be carried out in an appropriate and timely order, business contracts’ terms and conditions will be renegotiated to ensure strict compliance. For this objective, firm has listed incomplete steps in seafreight import and dealed with priorities and is elaborating a concrete roadmap to resolve the problem arising.
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Furthermore, the company is starting to conduct seafreight import business more into Korea market in view of Vietnam — Korea FTA being received more attention and increasingly utilized. Overall profit target of the company will increase to 5 billion VND and seafreight import will account upto 1 billion VND in 2018.
3.3. Solutions for improving forwarding service of seafreight import 3.3.1. Training and developing human resources
C#stablishing Customer Service Division:
- Basis: The company has no Customer Service Division; the speed of processing and response to problems of customers is slow, the connection with customers is not high; Besides, the workload of document staffs is huge and ineffective in case of multitasks.
- Objectives: This decision help to mitigate the processing time, render faster delivery, upgrade the service level, thus ultimately increase customer satisfaction; It also helps increase the productivity and morale of employees.
- Measures: HR Department will develop a job description and upload to the recruitment websites. The criteria require skills of solving problems related to orders and inquiries of customers; answering requests or complaints by phone or email; tracking delivery and sending notifications updating the status of delivery;
supporting others in sending quotations, schedules, policy and maintaining business relationship. Overall, amicable communication skill is a must. Hence, this position also requires contacting clients and foreign offices when necessary, thus communication in English is preferred. As the budget of the company is limited and the development policy does not allow excessive human resource, number of current recruitment is one person. (Estimated _ salary: 6,000,000 VND/people/month). In the future, if the workload keeps increasing due to business expansion, additional recruitment shall prevail.
- Expected result: once employed, customer service department will cover 20%
current workload of document officer. Customer will be taken care of better as claims will be processed and responsed within 15 minutes.
O Training programs for human resources:
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- Basis: The ability to recognize special goods (dangerous goods, perishables) of the employees is still low; lack of knowledge related to negotiation, effective management; the need to update human resource on skills and recent trends in the industry for future exploitation, ect.
- Objectives: The fact that human resource being trained helps to expand the types of goods imported of which the employees usually do not have experience; improve the productivity and professional of cargo-handling staffs; help business to obtain competitive advantage, being aware of new entrants and be ready for competitions.
- Measures: Sending employees to participate in training courses and programs at the relevant training center. However, it can be very costly.
There are 2 options for consideration: First, training will be conducted free of charge by Board of Directors who have experience and wonderful skills.
Nevertheless, schedule arrangement is extremely difficult for busy entrepreneurs.
Second, joining VLA. For being a member, the company can participate in conferences, seminars, training courses related to the field organized by the Association, Logistics Institute and relevant ministries/sectors. To join VLA, business needs to prepare an application form (Appendix 3.1), copy of the business registration certificate, copy of the business charter of the enterprise, summary report on business activities (Appendix 3.2). The annual membership fee is 1,000,000 VND for first and 6,000,000 VND for later years.
- Expected results: at least 80% human resource of the company are well trained and all forwarding officers can handle the procedure seamlessly, thereby confident in organizing special shipments; response more quickly and conform to the need of customers; reduce delivery time by 5% through faster coordination among parties and elimination of unworthy delays due to uncertainty or lack of knowledge;
together bringing about higher service level (85%) in six months after having participated.
3.3.2. Establishing KPIs for evaluating outsourced partners
- Basis: Frequency of delays in arriving at the port of the outsourced carrier; lack of clear separation of responsibilities when goods are lost or damaged; lack of connection and communication; low productivity and service level.
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- Objectives: Assessing the reliability and ability to fullfil their obligations on a regular basis, not based on subjective opinion or personal relationship. Improving the reliability and compliance of oursourced parties can help to reduce faults and relieve unworthy responsibility of the company, producing better service ultimately.
- Measures: Establishing KPIs for assessment. Specific KPIs suggested by the author of this report to evaluate truck fleet carriers shall be at Appendix 3.3 & 3.4 for new and in-service carriers. KPIs assessment forms will be kept track by the person working directly with the carrier for every single shipment. On the one hand, a grading scale shall be established to filter out ineffective links in the whole chain.
On the other hand, careful search for appropriate carriers are necessary and the negotiation of contract shall be strictly incorporated to prevent any confusion about the separation of cost and responsibility among parties.
- Expected result: Establishing business with two strictly standardized trucking parties via assessment and on detailed contract basis; maintain over 90% on-time arrival at port; continuous communication, visibility and safety compliance is ensured for every single shipment; delivery time is cut down by 10%.
3.3.3. Using management software under cloud computing technology - Basis: Integrate Logistics is still using traditional Excel, Word, which complicates the whole procedures; new technological systems (Cloud, SaaS, SAP) open up new way to manage business in the digital world at various level of expense; updating trends in technology renders optimization of processing speed;
- Objectives: Minimize delivery time; strict management of the outsourced carriers;
customers can actively track their shipments; transparency and accuracy in information input and transmission; investment for the future development;
- Measures: Utilizing CloFor solution from AFR Solutions Vietnam. This is a cloud- forwarding solution to freight forwarding companies hoping to improve their service, efficiency, and performance at reasonable price (20 USD/Month per a user license). This solution enables the company to keep track of the entire freight forwarding process and document operations. The outstanding characteristics involves end-to-end solution for forwarding and customer management with one-
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time input only and print-out function in various languages and templates. Details about the scope of activities under this solution will be presented at Appendix 3.5;
- Expected result: Document and customs clearance information can be managed 99% accurately and effectively as one-time input and instant print-out are applied, reducing overall processing time by 50%. Visibility in delivery can be enforced when trucking vendor, pick-up and destination detail have been posted and utilized on mobile apps. All e-mail with attachments will be transformed into encrypted URL. Exchange rate mistaking will be fully eliminated as the system have automatically snychronized the valid exchange rate to HBL and MBL. Besides the huge benefits to the forwarding process, accounting department can also reduce 50% workload as payment, profit and loss have been intensively managed. Higher effectiveness and professional management could render customer satisfactions and future expansion.